The results of the UAE energy business in the first quarter of 2023 recorded a significant jump in profits and revenues, supported by the growth of the company’s activity.
And the Abu Dhabi National Energy Company announced that achieving strong financial results, during the first quarter of this year for the period ending on March 31, 2023, was driven by strong and stable returns from its long-term contracted business in the utility sector.
She attributed the results of TAQA’s business in the first quarter of 2023 to achieving the financial jump to the one-time returns resulting from TAQA’s acquisition of a 5% stake in ADNOC Gas, according to the data seen by the specialized energy platform.
Energy earnings
The results of the UAE energy business in the first quarter of 2023 showed an increase in income to 11.6 billion dirhams ($ 3.16 billion), an increase of 9.6 billion dirhams ($ 2.61 billion).
The significant increase in TAQA’s profits came mainly from a one-time gain as a result of the acquisition of a 5% stake in ADNOC Gas.
During the first quarter of this year, the group achieved revenues of 13.1 billion dirhams ($3.57 billion), an increase of 6% compared to the same period last year.
This increase was mainly driven by higher wholesale tariffs and tariffs related to the use of the transmission network within the transmission and distribution sector, according to the UAE’s WAM agency.
Profits, according to the statement of the results of the UAE energy business in the first quarter of 2023, before calculating interest, taxes, depreciation and amortization, amounted to 5.3 billion dirhams ($ 1.44 billion), a decrease of 5%.
The results of TAQA’s business in the first quarter of 2023 showed that the value of capital expenditure amounted to 1.1 billion dirhams ($ 300 million), an increase of 26% compared to the same period last year.
Free cash flows amounted to 4.3 billion dirhams (1.17 billion dollars), an increase of 31% compared to the same period last year, despite the increase in capital expenditures.
UAE energy dividends
After the strategic decision to maintain TAQA’s business in the oil and gas sector, shareholders approved, during the annual general assembly meeting held last March, a new policy for distributing cash dividends for the years 2023 to 2025; So that the distributions include fixed profits and variable profits.
Under the new policy, fixed cash dividends will be distributed on a quarterly basis at 3.25 fils per share in 2023, 3.50 fils per share in 2024, and 3.75 fils per share in 2025.
As for the variable cash dividends; It will be distributed once a year and will be calculated according to a specified percentage of the annual net profit of the Group’s oil and gas business.
TAQA and the Abu Dhabi National Oil Company (ADNOC) are linked to an extended strategic partnership that the two companies established through the conclusion of a number of deals, the most prominent of which was the recent participation (along with the Mubadala Investment Company) in the ownership of shares in the Abu Dhabi Future Energy Company (Masdar), in addition to the carbon removal project. of ADNOC’s offshore operations, with a value of $3.8 billion.
Based on this solid partnership, TAQA obtained from ADNOC a 5% share of the total issued capital of ADNOC Gas, without any cash consideration for this share.
ADNOC Gas was listed on the Abu Dhabi Stock Exchange during the first quarter of 2023, and the stake is a valuable financial asset for TAQA.
In addition, TAQA’s net income is expected to increase, benefiting from the profits distributed by ADNOC Gas.
According to the announced policy for distributing profits at ADNOC Gas, TAQA expects to obtain profits of 298 million dirhams ($81.15 million) in 2023, to increase to 611 million dirhams ($166.39 million) in 2024.
TAQA’s achievements in the first quarter
The results of the UAE’s energy business in the first quarter of 2023 reviewed the most prominent operational achievements. The availability rate in electricity and water transmission networks reached 98.1%, a slight increase compared to 98% recorded in the same period last year.
The commercial availability rate in the electricity generation business around the world reached 98.8%, compared to 97.3% recorded in the same period last year, as a result of the contribution of existing plants in the UAE in particular to achieving this increase.
The average oil and gas production decreased to 119.9 thousand barrels of oil equivalent per day, a decrease of 5.52% compared to the same period in 2022.
The decrease is mainly due to the natural decline in production rates and the decommissioning of some of the Group’s assets in the UK, which have expired.
Jassim Hussain Thabet, Group CEO and Managing Director of Abu Dhabi National Energy Company (TAQA), said: “TAQA Group ended the first quarter of 2023 on a positive note, with a significant increase in our net income as a result of our acquisition of a stake in ADNOC Gas.”
Commenting on TAQA’s business results in the first quarter of 2023, he added: “Regardless of this, the company has made significant progress in implementing our growth strategy, along with achieving stable financial performance.”
He pointed out that in terms of growth, the company started the year by increasing its share in the independent “Al Taweelah B” station for electricity generation and water desalination, and it also acquired a share in the company responsible for the operation and maintenance work in this station. This has enhanced its operations and maintenance capabilities, which is one of the areas of growth for our business.
TAQA also partnered with Engie to construct the “Marfa 2” reverse osmosis desalination plant with a capacity of 120 million gallons of desalinated water per day.
Jassim Hussain Thabet continued: “In addition to the above, the company’s shareholders approved the new policy for distributing cash dividends for the years 2023 to 2025, which includes fixed profits and variable profits to ensure the provision of attractive returns to shareholders, in line with our constantly evolving business model.”
The Board of Directors of “TAQA” had approved the financial results for the first quarter of 2023, and announced the first installment of interim cash dividends of 0.65 fils per share (a total of 731 million dirhams – 199.07 million dollars) according to the company’s new dividend policy.
related topics..
Also read..
Leave a Reply